The opinion of the court was delivered by: Hon. Stanley S. Brotman United States District Judge

FOR PUBLICATION

OPINION

BROTMAN, DISTRICT JUDGE:

A. Background

Defendant Omega Institute, Inc. (hereinafter "Omega") was established in 1980 and is a private, post-secondary school providing alternative adult education in various fields, including allied health, legal support services, hospitality, business, and computer repair. Omega's curriculum and programs have been developed under the guidelines of the New Jersey Department of Education and have been periodically reviewed, evaluated, and approved by the Department of Education and by the school's accrediting agency, the Accrediting Council for Independent Colleges and Schools ("ACICS"). Most of the courses at Omega are approved for recommended credit at various local colleges, and the school has been successful in retaining its accreditation on a yearly basis.

The present action focuses squarely on Omega's paralegal/legal support training programs. Omega points out that it has offered these programs since 1980 and that the curriculum, programs, faculty, number of instruction hours, and support staff have evolved and changed over the years. Defs.' Br. in Opposition to Class Certification at 5-6. Some courses in these programs, in fact, have been entirely phased out. Id. at 6. Because of many changes over the years, defendants contend that the individual experiences of Omega students were different as well, depending upon when they were enrolled.. Id. at 7. The plaintiffs in this action contend, however, that their experiences at the school were not simply uneven. Rather, they claim that Omega shortchanged them in a variety of ways, and have brought suit to redress their grievances.

The United States Department of Justice's Civil Division, after originally commencing this action, filed with the Court on October 6, 1995 a Notice of Election to Decline Intervention. The named plaintiffs - stepping into the shoes of the Government - now bring this qui tam action on behalf of themselves and other former and current Omega paralegal students. They argue that Omega operated by making false statements regarding its paralegal training in documents it filed with the U.S. Department of Education, the New Jersey Department of Education, and Job Training Partnership Act (" JTPA") bodies. Plaintiffs assert that written documents Omega provided to its prospective students contained these false statements and were consistently the same, regardless of whether the intended recipient was a student or a government entity. More specifically, plaintiffs allege that the actual number of instruction hours they received, the school's attendance policies, and the quality of the school's instructors which they observed for themselves were not in keeping with the written statements Omega promulgated. Essentially, plaintiffs argue that the written statements in question were greatly exaggerated when compared to their actual educational experiences at the school.

Following a May 1, 1997 Order to Show Cause hearing, the Court, in an opinion and order dated May 6, 1997 denied plaintiffs' application for findings of contempt and other injunctive relief. Subsequently, in a November 25, 1997 opinion and order, the Court denied plaintiffs' motion for class certification pursuant to FED. R. CIV. P. 23(a) and (b). More recently, on May 4, 1998, plaintiffs' counsel filed an action in the Superior Court of New Jersey, Gloucester County, captioned Raggio, et al v. Omega Institute, et al, GLO-L-849-98, seeking class certification. On May 6, 1998, plaintiffs filed a Notice of Voluntary Dismissal of Counts III through IX of the First Amended Qui Tam Complaint. By virtue of an amended scheduling order filed May 28, 1998, Magistrate Judge Joel B. Rosen extended the dispositive motion deadline to June 10, 1998. The Joint Final Pre-Trial Order was entered by the Magistrate Judge on June 29, 1998.

In the interim, the Court has received a flurry of motions. Presently before the Court and ripe for decision are (1) a motion for summary judgment by defendants Omega Institute, Lee E. Cobleigh, Franklin Burke, Clarita Eusebio-Kelly, Raymond Papin, Adele Winter, Joseph Marra, and Sharon E. Gremmels filed December 16, 1997; (2) a motion to dismiss, or in the alternative for a stay pending an administration proceeding currently underway by the United States Department of Education ("DOE"), also filed December 16, 1997; (3) a motion by the above-named individual defendants for summary judgment, filed June 10, 1998; and (4) a motion by all defendants "for Summary Judgment to Limit the Scope of Plaintiffs' First Amended Qui Tam Complaint and to dismiss Plaintiff Beverlee Ralph's Complaint," filed June 10, 1998. Also before the Court is a motion by defendants to impose certain conditions upon the plaintiffs' voluntary dismissal of Counts III through IX. *fn1

The Court has jurisdiction over this case pursuant to 28 U.S.C. § 1331 because it arises under the federal False Claims Act, 31 U.S.C. § 3729, et seq. 28 U.S.C. § 1367 confers supplemental jurisdiction upon the Court over plaintiffs' state statutory and common-law claims. Venue in the District of New Jersey is proper pursuant to 28 U.S.C. § 1391, in that the actions complained of arose in this district and all named plaintiffs reside in Gloucester County, New Jersey.

B. Discussion

I. Defendants' Motion to Dismiss, or Alternatively For a Stay

. The plaintiffs in this case are students of Omega's paralegal training program. They specifically allege that Omega violated the False Claims Act, 31 U.S.C. § 3729-3733, by obtaining financial aid funds for its paralegal training program while it was ineligible to receive such funds.

In 1995, the DOE began an enforcement investigation or program review of Omega relating to its compliance with federal funding regulations, and to investigate Omega's administration of Title IV student financial assistance programs. This investigation is still ongoing. Therefore, defendants, relying on the doctrine of "primary jurisdiction," have filed a motion either to dismiss without prejudice or, in the alternative, for a stay pending completion of the DOE's enforcement action.

A. The Department of Education's program review does not negate the relators' rights to proceed with their qui tam action

Under 31 U.S.C. § 3730 (a), the responsibility for bringing civil actions for false claims rests with the Attorney General. A private individual, however, may also bring a civil action for a false claims violation on his or her own behalf and on behalf of the United States government. *fn2 Such an action is called a qui tam action and the plaintiffs are called "relators." In this situation the government has the option to intervene.

When the government declines to intervene in the qui tam action, case law provides that a relator's claim should not be stayed or dismissed without prejudice even though the government may pursue an alternate remedy. In United States ex. rel. Dunleavy v. County of Delaware, 123 F.3d 734 (3d Cir. 1997), the Third Circuit Court of Appeals held that the Department of Housing and Urban Development's (HUD) settlement of a dispute with Delaware County in Pennsylvania regarding the County's allegedly improper retention of HUD's funds did not impair the relator's right to pursue a qui tam action under the False Claims Act (FCA).

In Dunleavy, Judge Roth opined that she was uncertain whether the U.S. Attorney and HUD intended the settlement with the County to extinguish the government's claims under the FCA or whether the settlement addressed a less serious transgression such as misrepresentation. Id. at 738. Nevertheless, she explained that resolving the uncertainty was immaterial because the government never exercised its right to intervene into the relators' FCA qui tam action. Therefore, the settlement between HUD and the County did not negate the relator's ability to proceed independently with his qui tam action. Id. at 739. In so finding, the court agreed with the Eleventh Circuit's conclusion that the FCA's purpose is not limited to punishing the wrongs against the public; the FCA also fills a remedial capacity in redressing injury to the individual relator. Id. at 739.

As noted above, the government has declined to intervene in this case. Instead, the government, through the Department of Education, has elected to conduct a program review of Omega Institute's administration of federal student financial aid programs and has demanded repayment. Based upon Third Circuit case law, the DOE's pending administrative program review does not negate the relators' rights to proceed with this qui tam action.

B. The doctrine of "primary jurisdiction" cannot appropriately be applied to this case

The doctrine of primary jurisdiction is concerned with promoting proper relationships between the courts and administrative agencies charged with particular regulatory duties. MCI Telecomm. Corp. v. Bell of Pennsylvania, 71 F.3d 1086, 1108 (3d Cir. 1995) (citation omitted). It applies where a claim that is originally cognizable in court requires the resolution of issues that, under a regulatory scheme, have been placed within the special competence of an administrative body. Id. at 63-64. The primary jurisdiction doctrine does not deprive a court of its jurisdiction, but it requires it to suspend further judicial proceedings, pending referral of the issues for an administrative ruling. Reiter v. Cooper, 507 U.S. 258, 268 (1993).

There are strong policy reasons for applying the doctrine of primary jurisdiction in an appropriate case. Initially, the doctrine promotes consistency and uniformity, particularly where development of the law depends upon administrative policy. Nader v. Allegheny Airlines, Inc., 426 U.S. 290, 303-304 (1976). Second, an administrative agency may be uniquely qualified to resolve certain complexities that are outside the conventional experience of the courts. Finally, judicial economy will be served where the dispute may be decided within the agency, thus obviating the need for court intervention.

Nevertheless, in Luckey v. Baxter Healthcare Corp., 1996 WL 242977 at 4-7 (N.D. Ill. May 9, 1996), the court declined to apply primary jurisdiction to relator's claim that the defendant had failed to test blood products properly, notwithstanding the Food and Drug Administration's general jurisdiction over the subject matter. The court relied upon the government's amicus curiae brief which presented sound bases for refusing to invoke primary jurisdiction. *fn3 The Department of Justice argued:

that there was no need for judicial deference to agency authority in this case, noting that the FDA has no authority to adjudicate or provide relief for a false claims action. Moreover, the government points out that the FDA has not come before this court to assert any perceived administrative prerogative, and that although the government has the authority under 31 U.S.C § 3730(c)(5) to move the matter to an administrative agency, or to dismiss this action under 31 U.S.C. § 3730(c)(2)(A), it has declined to do so. Id. at 5.

In this case, the Department of Education administers student financial aid programs. The DOE, with its program review, is pursuing a matter with regard to defendants that is based on the same facts alleged in plaintiffs' qui tam suit but does not involve allegations of a false or fraudulent claim. *fn4 In such an instance, the relator has no right to participate or to share in the government's alternate recovery because, under 31 U.S.C. § 3730(c)(5), the relator "shall have the same rights in such [alternate] proceeding as such person would have had if the [district court] action had continued."

In this case the DOE has not investigated false or fraudulent claims, and lacks authority to do so. The exclusive authority to adjudicate FCA and fraud claims rests with the Department of Justice and the Attorney General. *fn5 The DOJ has, additionally, authorized the qui tam relators to pursue the action for fraud claims in the name of the United States. Furthermore, in United States v. General Dynamics Corp., 828 F.2d 1356, 1363 (9th Cir. 1987), the court explained that in order for primary jurisdiction to apply, the particular agency deferred to must be one that Congress has vested with the authority to regulate an industry or activity such that it would be inconsistent with the statutory scheme to deny the agency's power to resolve the issues in question.

Moreover, even if the DOE had the authority to adjudicate FCA claims, the DOE could not exercise this jurisdiction because the government has declined to intervene. In Dunleavy, Judge Roth found the legislative history accompanying the 1986 Amendments to the FCA instructive. She cited the report which followed the Senate version of the amendments, which Congress passed in lieu of those in the House bill, explaining the Government's right to proceed administratively as an alternate remedy to an FCA action.. The report stated:

While the Government can compel dismissal or settlement of a qui tam action if it formally intervenes, 31 U.S.C § 3730(c), Congress believed that "if the Government declines to intervene in a qui tam action, it is estopped from pursuing the same action administratively or in a separate judicial action." Dunleavy, 123 F.3d at 739 (quoting S. Rep. 99-345, 99th Cong., 2d Sess. 27, reprinted in 1986 U.S.C.C.A.N. 5266, 5292).

In Dunleavy, the Third Circuit determined that the plaintiff, if found to be a proper relator, had an interest in pursuing his claim independently of the government, which elected not to intervene. Id. Where the government declines to so intervene, it cannot compromise plaintiff's claim, even if it settles its own claim against a defendant. Id. In the case at bar, no claim by the government has even been settled; it has, quite simply, declined to become actively involved, its amicus filing notwithstanding. Defendants' reliance on the doctrine of primary jurisdiction to stay the action in this Court is therefore misplaced, and their motion to dismiss or alternatively for a stay will be denied.

II. The Individual Defendants' Summary Judgment Motions

In three separate briefs (all encompassing one motion per se), defendants move for summary judgment in favor of the named individual Omega employees and officers - specifically, for summary judgment in favor of defendants Cobleigh and Burke; Kelly and Gremmels; and defendants Papin, Winter, and Marra. Although ...

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